Firm: Baltimore home prices down 8.8%
A real estate data firm says Baltimore metro area home sale prices were 8.8 percent lower in the four months ending Dec. 24 than they were a year earlier.
Good news from the company, Clear Capital: Most of the people selling were ... well, people selling. Bank-owned properties made up 15 percent of home sales in the metro area, which isn't as low as some places but is a heck of a lot lower than the 30 to 50 percent in some of the worst-hit parts of the country. (More than half of sales -- 53 percent -- were bank-owned in Riverside, Calif.)
Bad news: Baltimore was No. 9 on the company's list of "lowest performing major markets" because prices dropped almost 1 percent from the previous quarter. (Baltimore's quarterly price rose very slightly in the summer, according to Clear Capital.)
Of course, your idea of "good news" and "bad news" will be reversed if you're trying to buy a foreclosure and want prices to keep coming down. (At least there's some good news for everyone ...)
Top performer, according to Clear Capital: Detroit. Yes, Detroit, land of $10,000 homes, which saw a more than 17 percent increase vs. the previous quarter. The company attributed that to the metro area's foreclosure-saturated market, saying bank-owned prices "continue to rise from their steeply discounted levels of early 2009."
Clear Capital, which draws its sales figures from assessors' and recorders' offices, calculates price by comparing repeat sales of the same homes over the years. You might have noticed that its most recent "quarter" is four months rather than three, and that's by design. It throws in an extra month of sales for balance in order to include very recent numbers, which come from data that can be incomplete.
Categories: Housing stats, The foreclosure mess
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Comments
2010 should shape up to be a great year for the Baltimore real estate market. Between the housing prices going down and the homebuyers tax credit deadline being pushed back to the end of April, the first quarter in Baltimore should be huge.
Posted by: Simon Landau | January 7, 2010 12:17 PM
Um...how about after April.....oh, foolish me - I am sure the tax credits will be extended!
Posted by: Darwin Rules | January 7, 2010 3:00 PM
All of this stimulus does not matter. It is just a band aid. When rates go up, prices will have to go down. It is just how things work. When rates go down, prices go up because the buyers can afford the higher loan amount due to the lower rate. When the loan amount stays the same, but rates go up, the buyer then will have a much higher payment. Take into consideration that rates will go back up when the Fed discontinues the Mortgage Backed Securities Purchase Program, you will see rates well over 6%. In fact, I predict rates will go up to 8% this time next year. It has nothing to do with our economy. More so the fact that there are no other end buyers of MBS other then the Fed. Private investors will demand a much higher return. Rates need to go up anyway. High real estate values does not help the economy. We are just re-inflating the bubble. If we really want to solve the problem, we should let values continue to fall and rates go up to normal levels.
The fact of the matter is that mostly everyone who could have refinanced has done so by now. So the cost savings for people who already have a home have been realized. What really is the benefit of keeping home prices inflated with subsidized rates for purchases? Would you rather buy a home at $250k with a 5% rate and payment of $1,342 (without escrow) or $185k at 8% with a payment of roughly the same?
The days of cashing out on your home to pay off debt is long over. If you own a home, you can't expect to sell in just a few years to make a quick buck. The new normal in real estate will be gaining equity by paying down your loan balance and home appreciation by inflation.
Posted by: Frank Rizzo | January 8, 2010 3:33 PM